How Much Video Do We Really Need to Steal?

The specter of Napster — and such successor file-sharing services as Kazaa and Morpheus — have cast a pall over many key digital-era content and technology issues.

The Hollywood studios — petrified of what happened to record companies, including some of their own corporate siblings — are understandably protective of their content in a digital world, in which so much power and connectivity has been placed in the hands of the average consumer. Every week, piracy slaps them in the face as movies are traded on file-sharing services even before they debut in theaters.

It doesn't matter that such copies may not be of the best video quality. The fact that some folks had The Matrix Reloaded
in their hands before it screened theaters May 14 absolutely infuriates Hollywood. That's unquestionably understandable.

But that fury also carries over to key points in other debates, and it's not at all clear that there are parallels to Napster and the music industry in every phase of digital-era video distribution.

There are crucial differences between the music and video industries that are worth examining.

First, the music industry is based on two, prepackaged forms: the single (typically 3 to 4 minutes in length) and the CD (which typically runs for 45 minutes to an hour). Those lengths are a vestige of the long-playing vinyl record. Remember when consumers had to buy an entire album in order to get the one to two songs they really wanted?

Napster changed all of that. Consumers could download as little or as much music as they wanted and were able to create their own playlist — for free, of course. Part of the Napster phenomenon was a reaction to consumers feeling shafted when paying $15 for 10 songs.

If successful, Apple Computer Corp.'s iTunes service (99 cents per song, per download) could provide a revenue model to which consumers will flock, and that will allow record companies and artists to get something back for their work. Digital technology puts a lot of power in a consumer's hands, but piracy can be limited by smart business models from artists and record companies (such as iTunes).

Sell music they way people want to hear it. If CDs don't sell as much, perhaps sales of singles will pick up half or more of the slack. It beats today's world of rampant file sharing, in which copyright holders aren't paid.

Music is also inherently short (three minutes) and portable. Plug it into an MP3 player, and off you go.

Video, on the other hand, has entirely different characteristics. It comes in half-hour, full-hour or two-hour, movie-length forms. It's not as easily digestible on the run. It's not background noise like music, but requires more full-time attention.

Do people really want to trade peer-to-peer files of a movie released two years ago? DVDs have come down in price to the point where they're cheaper and more efficient to buy.

And how many people really want to share an episode of The Sopranos from three years ago? Even though The Sopranos is popular, can that number be more than a few thousand?

The key weakness for video is the about-to-be-premiered product, such as the hit movie release, or the new episode of a popular TV series. There is no doubt pirating such content holds great allure, and that's where copy protection is most needed.

But the content community, led by Hollywood, would love to see "copy-never" clauses — as exist in the current plug-and-play agreement between cable and the consumer-electronics industry — all across the board. As Starz Encore Group LLC points out, the Betamax case clearly allows for in-home, non-distributed copy usage of video product.

The merits of Starz's arguments will be for the lawyers, lobbyists and maybe even the judges to eventually decide.

But as the content, platform and consumer electronics industries plunge into the digital era, it's worth taking a second look at the assumptions everyone thinks are written in stone on whether video will suffer the same fate and music in the digital world.